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Wednesday, November 29, 2006

KV Kamath is BS Banker of the Year

Kundapur Vaman Kamath, managing director and chief executive officer of ICICI Bank, has been chosen Business Standard’s Banker of the Year for 2005-06.

The choice is based on his track record, a perception audit in the industry, and a poll involving senior editors of the newspaper.

Business Standard’s Banking Annual, being distributed with today’s edition, features the success story of ICICI Bank.

It also covers a round table discussion that took place earlier this month, involving the CEOs of eight leading banks and the secretary, financial sector. The subject of the discussion was: “Can the banking system support India’s growth?”

While admitting that there was stress and issues ranging from human resource, technology, and skill to resources, capital, and consolidation, all bankers participating in the round table exuded confidence that the banking system could support India’s growth. The CEOs were all for consolidation to build scales.

Vinod Rai, secretary, financial sector, assured the bankers that the government would support the move for consolidation.

As for Kamath, he has not only brought back the old ICICI from the brink of collapse under the burden of bad loans and growing asset-liability mismatches by converting itself into a bank through a reverse merger with ICICI Bank four years ago, but also made it a retail powerhouse by building a retail portfolio of over Rs 1,00,000 crore.

In percentage terms, retail assets now account for 69 per cent of ICICI Bank’s total assets. Out of this, 51 per cent is mortgages. With over Rs 68,000 crore of market capitalisation at present, ICICI Bank is way ahead of the country's largest commercial bank, State Bank of India. It accounts for close to 23 per cent of the total market capitalisation of all listed Indian banks.

The compounded annual growth rate of ICICI Bank’s assets for the last three years stands at 23.86 per cent.

Though it is a very distant second to the State Bank of India in terms of asset base (Rs 2,51,389 crore against Rs 3,93,870 crore on March 31, 2006), the gap has been narrowing fast.